Under questioning by Deeming’s counsel Sue Chrysanthou SC, Pesutto admitted he made a mistake when he told media Kellie-Jay Keen-Minshull had a “rap sheet of associations”, including to neo-Nazi and former head of the Ku Klux Klan, David Duke.

Keen-Minshull, an anti-transgender rights campaigner, was partly responsible for organising the Let Women Speak rally on the steps of Parliament House in Melbourne’s CBD last March.

Almost 30 minutes before Deeming spoke at the rally, it was gatecrashed by a group of neo-Nazis dressed in black.

Pesutto has been sued for the alleged imputations he made about a link between Deeming and the neo-Nazis.

On three occasions with media prior to a bid to have Deeming ousted from the Liberal Party, Pesutto made the Ku Klux Klan comment.

When asked whether his press was being monitored by a member of his team as it occurred, Pesutto said they “typically do”, but “they didn’t pick up that error … [it] was pointed out to me later that day”.

“Your Honour, I was informed by one of my part-time staff members later in the day … that I had misspoken,” Pesutto told the court.

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Chrysanthou said that by making the association and mentioning Keen-Minshull’s alleged “rap sheet”, Pesutto had been suggesting to media and the public that Deeming was aware of this link.

Pesutto rejected this, insisting during the examination that he had sought to do “precisely the opposite” with his comments.

This line of questioning led to an accusation that Pesutto was treating his cross-examination “as though you can avoid the question and give a prepared answer, like in a press conference”.

Pesutto dismissed this.

Chrysanthou then put to Pesutto that it was “dishonest” of him to not publicly announce his error and to instead “let it fester”.

Pesutto did not accept this, telling the court it was “pretty obvious once all the material was out there that that was the case” and he insisted he did not repeat the error once it was pointed out to him.

Later in the cross-examination, Chrysanthou put to Pesutto that his office was giving media parts of a draft dossier that he would seek to use in his bid to have Deeming expelled from the party.

Pesutto said his media team was often communicating with journalists as part of its job and accepted that while they were talking to journalists during the day in question, he did not accept the contention it was to leak the dossier.

Chrysanthou then suggested Pesutto directed staff to leak messages he received from former federal Liberal MP Sarah Henderson, who was against his bid to oust Deeming, but he rejected this.

“I had a range of people during the week, as you can imagine, raising the question with me as to whether federal MPs were concerned and if they were talking to me. A number of federal MPs contacted me, that was unremarkable,” Pesutto said.

The hearing continues.